Spain Lifts Short-Selling Ban on Stocks After IBEX 35 Rallies

Spain lifted a ban on short-selling
stocks as the benchmark IBEX 35 Index (IBEX) rallied and the country’s
banks took steps to repair their balance sheets.

Authorities won’t extend restrictions that expired today,
the stock market regulator, known as CNMV, said in an e-mailed
statement today. Short-sellers sell borrowed shares with plans
to buy them back later at a lower price, a practice some
politicians and investors blame for roiling markets.

After implementing the deepest austerity measures in
decades, Spain “is sowing the seeds of growth,” Economy
Minister Luis de Guindos said at a discussion forum in Davos,
Switzerland, last week. The country is “fully on track to grow
again,” he said.

Spanish lenders have been booking costs to comply with
government orders to recognize losses on real estate that piled
up on their balance sheets as Spain’s property boom turned to
bust. The IBEX 35 has surged 40 percent since last year’s low on
July 24, compared with a 15 percent gain in the Stoxx Europe 600
Index.